US Residents Losing Access to Binance - Here’s How You Should Prepare
Binance recently announced that it will block all cryptocurrency exchange services to users in the US in the future. This guide describes how you should prepare for the loss of access from both a trading and a tax compliance perspective.
This announcement comes after the exchange also announced that it will be launching a separate service that will cater towards US citizens, Binance.US. This is all likely a result of dealing with the regulatory pressures of operating within the US. It is not clear exactly when this new platform will launch nor which cryptocurrencies will be offered on it.
If you are a US passport holder on Binance, you will no longer be able to trade on the platform once September arrives.
How to Prepare From a Trading Perspective
If you are a trader on Binance, you should be aware of which assets you are going to lose trading access to.
In the below graphic, the tokens highlighted in purple are traded on other U.S. compliant exchanges, so you have the ability to move these assets onto these exchanges. Tokens that are not highlighted in purple do not have other exchange support within the US.
If you hold significant amounts in any of the non-highlighted tokens, you should take action before the September deadline hits. If you fail to do so, you could be stuck holding tokens that you have no way of cashing out of. Don’t worry, our team will send out another update to remind you prior to this deadline.
How to Prepare From a Tax Perspective
It sounds like US based Binance users will still have access to their accounts—just without the ability to perform trades. Either way, we believe it is smart to pull all of your trade history files from the exchange to keep for your records.
As a reminder, getting your crypto taxes done without your proper historical data is essentially impossible, so we believe it’s better to err on the side of caution.
To get your historical data from Binance you can do one of two things:
1. Run the API importer in your CryptoTrader.Tax account
Login to your account and make sure you have Binance selected as an exchange that you trade on.
Navigate to step 2, enter your API keys, and automatically import all of your trades into your account.
Now you have your most recent historical data into your account so that once 2019 ends, you can easily run your crypto tax report.
2. Download your historical data files from Binance.com
Like most exchanges, Binance also allows users to export excel spreadsheet files that detail all of their transaction history on the platform. You can always import these .XLSX files directly into your CryptoTrader.Tax account with a simple drag and drop so that you can easily generate your tax reports at year end.
We recommend downloading these trade history files and storing them in a safe place for your records.
While it looks like US users will still be able to access their accounts and generate reports once September comes and goes, we believe it’s a good idea to be prepared for any outcome. On the contrary, if you have assets on Binance that you are going to lose the ability to trade, you should move them into bitcoin or another cryptocurrency before the September deadline.
To learn more about how cryptocurrency is taxed, you can checkout our complete 2019 Cryptocurrency Taxes Guide.
Disclaimer - This post is for informational purposes only and should not be construed as tax or investment advice. Please speak to your own tax expert, CPA or tax attorney on how you should treat taxation of digital currencies.